Tuesday, January 7, 2014

La donna è mobile

According to taxation theory, a benevolent government should tax less individuals who have a more elastic labor supply. Therefore, as labour supply of women is more elastic than men's, tax rates on labour income should be lower for women.

Or, tax the bums out;

Gender based taxation reduces tax distortion, improves welfare and increases gross domestic product and total employment, but in particular contributes to speed up a process of gender equality that is in progress but it is still to slow. GDP contributes to gender equality because it raises the bargaining power of women within the couple, it generates a more equitable allocation of house vs. market work, changing spouses’ bargaining power and reallocating the last hour spent with children from the mother to the father, which means to improve family's welfare. If women were less taxed, they could finally say to men: “It is 4 o’clock: go to pick up our children from school, stop at the grocery store and start to cook, it is more convenient for all the family if I stay at work and you stop working at 4 p.m.”